Project Management Essential Terms

This is part 1 of three articles that lists the project management terms and definitions any project manager or anyone who is involved in project management activities should know. Effecient and eefective communication requires common understanding of the used terms and terminologies.

• project is a temporary endeavor to create a unique product or service. Operations are ongoing activities.
• The project life cycle is comprised of phases.
• The completion of a project phase may also be known as a kill point or stage gate. Kill points are typically at the end of a project phase.
• Progressive elaboration is the process of taking a project concept through to the project plan. As the planning and research activities continue, the more detailed and focused the concept becomes. Progressive elaboration happens throughout the project. It is the process of elements within the project becoming more and more exact as additional information and details become available.
• Rolling wave planning requires the project manager and the project team to revisit the planning process to address the next phase, implementation, or piece of the project.
• Milestones are completed by the project team as the results of activities.
• Project scope defines the required work, and only the required work to complete the project.
• Scope verification is the proof that the project manager has completed the project.
• Quality policy is the organization-wide rules and requirements for quality.
• Programs are a collection of projects with a common cause.
• Customers, internal or external, are the most important stakeholders in a project.
• The project management office can be established to offer services ranging from basic support to total management of all projects.
• Maintenance activities are not part of projects.
• Management by objectives tries to focus all activities on meeting the company’s objectives. If the project’s objectives are not in line with the company’s objectives, the project may be impacted or cancelled.
• The project coordinator reports to a higher-level manager and has authority to make some decisions. The project expediter has no authority to make decisions.
• Cross-disciplinary means that the project covers more than one department or technical area of expertise. In such a case, a matrix organization is needed with representatives from each department or discipline.
• Email is not a Formal Communication.
• Arbitration is a form of negotiation.
• The PMO determines whether a project supports the organization’s strategic plan and can authorize exceptions to projects not linked to the strategic plan.
• It is a responsibility of the project management office to prioritize the company’s projects. When prioritization is clear, it is easier to allocate resources among projects.
• Verify Scope process occurs during project monitoring and controlling, but product verification is done during project closing.
• Deliverables are determined in part by the customer, but not the sponsor.
• The project manager or the project management team determines how best to accomplish the project.
• The project charter gives authorization to begin a project or project phase. The project charter is approved in the initiating process group.
• The Performance Measurement Baseline is used for Earned Value Measurements.
• Configuration Management System (CMS): Is a subsystem of the PMIS, which includes the processes that define how project deliverables and documents are controlled, changed, and approved. And it includes the Change Control System to provide a standardized, effective, and efficient way to centrally manage approved changes and baselines within a project.
• Fait accompli: An accomplished fact; an action which is completed before those affected by it are in a position to query or reverse it.
• WBS: WBS a deliverable-oriented hierarchical decomposition of the work to be executed by the project team. The WBS is finalized by establishing Control Accounts for the work packages and a unique identifier from a code of accounts. The WBS represents all product and project work, including the project management work (This is sometimes called the 100% rule).
• The WBS can be structured as an outline, an organizational chart, a fishbone diagram, or other method.
• Different deliverables can have different levels of decomposition.
• Excessive decomposition can lead to non-productive management effort, inefficient use of resources, and decreased efficiency in performing the work.
• Decomposition may not be possible for a deliverable or subproject that will be accomplished far into the future.
• Work Performance Information: Focus on WHAT has been done (provides information on the Status of a Deliverable.
• Project Cost Baseline = Project Estimates + (Cost) Contingency Reserves.
• Project Cost Budget = Project Cost Baseline + Management Reserves
• Residual Risks comprise of: 1. Risk that remain after applying risk response strategies, and 2. Risks that we simply ACCEPT — if it happens, it happens, we have a plan to deal with it.
• Contingency Plans deal with the outcome of Residual Risks on project.
• Contingency Reserve covers the outcome of Residual Risk, and account for the “Known Unknowns”.
• Fallback Plans are employed for Residual Risks when the Contingency Plans fail.
• Secondary Risks are new risks that emerge as a result of Risk Response Plan.
• Watch list: All non-critical/non-top/low rating risks are put on the Watchlist and monitored (Watched) regularly. It is created at Perform Qualitative Risk Analysis Process.
• Management Reserves account for the “Unknown Unknowns”.
• Utility Theory: An appropriate method for describing Risk Tolerance.
• Risk Averse: Where there is more money at stake, the Risk Averter’s satisfaction diminishes; he or she prefers a more certain outcome and demands a premium to accept projects of high risk.
• Risk Neutral: Tolerance for risk remains the same as the money at sake increases.
• Risk Seeker: The higher the stakes, the better; as risk increases, the risk seeker’s satisfaction increases; he or she is even willing to pay a penalty to take on projects of high risks.
• Force Majeure Risks, such as Earthquakes, Floods, Acts of Terrorism, Etc., should be covered under Disaster Recovery Procedures instead of Risk Management.
• Monte Carlo Analysis would show you WHERE SCHEDULE RISK EXISITS (Points of Schedule Risk). It is a Computer-based Analysis & useful for revealing Schedule Risks
• Committee decisions can have the paradox outcome, that a jointly made or approved decision is not desired by any individual group member.
• What is a constructive change? A direction by the buyer or an action taken by the seller that the other party considers an undocumented change to the contract.”
• Liquidated damages (LDs) are contractually agreed payments in order to cover the customer’s costs caused by late completion or failure to meet specifications by the contractor.

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